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Highland Park becoming gentrified

March 11, 2012 |  7:23 am

Highland park homes

Investors have descended on Highland Park and other communities in Northeast Los Angeles, snatching up bargain-priced Craftsman homes located within an easy distance of downtown. It's an echo of the housing boom, only this time speculators are drawn by the crash in prices.

Attracted by an abundance of foreclosures and aided by interest rates near record lows, renovators are giving distressed properties a makeover. They're then reselling them to young professionals priced out of nearby Echo Park and Silver Lake, who are finding Highland Park's bike lanes, Metro Gold Line stop and sidewalk culture a welcome respite from the automobile.

In the process, the neighborhood of working-class Latinos and art-loving bohemians is being transformed into an outpost of hipster cool. Yoga studios, design firms and galleries are sprouting near Mexican grocery stores and auto repair shops.

The changes are stirring a debate not loudly voiced since the boom days: Is an influx of wealthier neighbors a good thing?

For Adam L. Bauer and his brother Logan, the answer is an unequivocal yes. They took the plunge into Highland Park last year, pooling their money to buy a three-bedroom bungalow on a quiet street for $494,000.

One recent morning, as the sounds of a jackhammer nearby echoed in their newly refurbished kitchen — replete with ebony-stained hardwood floors — the brothers sat and marveled at the fast pace of change.

"We've been here since May, and in a two-block radius there have probably been eight homes done," said Logan, a writer and lifestyle and wellness consultant. "It's nice that there is still a place where artists or families aren't priced out of buying a home. And a house that is a good size, that isn't a shoebox."

Steve Jones, the principal of development firm Better Shelter, sold Bauer his home and has redone 20 homes in Highland Park and an additional 15 in other parts of Northeast Los Angeles. He believes development in Highland Park is on an upswing.

Highland Park's affordability and somewhat undiscovered status have given it a certain cachet among the hipster set. LA Weekly's Pop-Ed blog recently dubbed Highland Park the new cool neighborhood "for those who are 'over Echo Park.'"

"There is a large inventory of homes to be polished, or flipped, or what have you," Jones said. "Given the realities of what homes cost in L.A. for a first-time home buyer, they are willing to invest in the future."

Investor activity has picked up in Highland Park in recent months, and throughout Northeast Los Angeles. Absentee buyers purchased 29.1% of the homes sold in Highland Park, 18.6% in Eagle Rock and 25.4% in Glassell Park and Cypress Park during the fourth quarter of 2011, according to real estate firm DataQuick. In January, DataQuick said, investors bought 2 in 5 of the homes sold in Eagle Rock and Highland Park and 1 in 5 of the homes sold in Glassell Park and Cypress Park.

Because many of those homes are bargain-priced foreclosures, that interest has yet to translate into a big jump in median home prices. And annual sales throughout Northeast L.A. have remained flat since 2009.

With a median home price of $308,250 in the final three months of last year, Highland Park remained the cheapest of the northeast neighborhoods. Eagle Rock's was $425,000 and the Glassell Park and Cypress Park area's was $362,000.

When it came to median price per square foot, Highland Park's was $287 in the fourth quarter of 2011, up 1.2% from the same period a year earlier, while Eagle Rock's was $319, down 1.4%, and the Glassell Park and Cypress Park area's was $298, down 8.7%.

Eric Toro, a real estate agent with Prudential California Realty in Glendale, said he believes Highland Park still has a way to go. Still, he said he's heartened by a recent influx of new businesses.

"You don't see as many vacancies as you did before," he said.

Settled in the late 19th century, Highland Park is one of the oldest communities in Los Angeles and has a long artistic and architectural heritage. Homes in the American Craftsman style of architectural design took root around the Arroyo Seco and pervade the neighborhood today.

In the 1960s, the area experienced white flight and many Mexican American families moved into the neighborhood; it remains heavily Latino today. Gang violence plagued the area for decades, with the notorious Avenues gang claiming parts of Highland Park, Cypress Park and Glassell Park as its territory. But in recent years, violent crime has declined citywide.

The eastward march out of trendy Silver Lake and Echo Park began in the mid-2000s as the housing boom began pricing people out of those areas. Gentrification sputtered with the crash but has picked up again as nimble developers converted foreclosures into marketable properties that are, depending on your tastes, either charming gems or too-trendy showpieces.

Ground zero for the neighborhood's change is a stretch of retail shops along York Boulevard near North Avenue 50 that includes the gastropub the York, Cafe de Leche and the Hummingbird Collective (part marijuana dispensary, part art gallery).

Throughout Highland Park the change is evident. There is Anatomy Fitness, a Zumba and yoga center that is flanked by a Mexican juice shop and an empty storefront. There is Fresco Community Market, a sparkling new organic grocery store that works with a downtown nonprofit to employ the homeless.

Some of the neighborhood's long-established businesses have said they've noticed an uptick in sales. Raul Aguilar, who with his brother owns the Garvanza Hardware shop, which has been in the neighborhood since 1906, said business has improved in the last six months. Contractors who work for home renovators and handymen are stopping by more often.

"The situation is unsticking a bit," Aguilar said, speaking in Spanish as he stood behind his front counter while three customers wandered the rows of his plumbing and electrical offerings. "I talk to a lot of people who do home repairs, and they tell me that they are buying a lot of homes again, though this time with much more caution."

The development and neighborhood changes are closely chronicled in popular blogs such as the Eastsider LA, where readers hotly debate about the influx of investors.

Jesus Sanchez, founder of the blog, said he has heard complaints from longtime Highland Park families being priced out of the neighborhood. Others point to the aesthetic choices of the developers, with their horizontal wood fences and brightly painted doors, as being of a different class.

"It has elicited a lot of emotions," Sanchez said. "Some people do feel like they've been left out.... There is alienation."

But, he added, "you have a lot of homeowners, white and brown, who are happy with the changes."


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Photo: Steve Jones, left, and Adam Bauer survey the neighborhood from Bauer's porch. Homes are more affordable than in trendy Eagle Rock nearby. Credit: Katie Falkenberg / Los Angeles Times